What does the franchise agreement between Crave Cookies and the franchisee set out?
Crave_Cookies Franchise · 2025 FDDAnswer from 2025 FDD Document
The Company is a franchise company for Crave Cookies locations. The Company grants franchisees the right to operate a physical storefront location using the Crave Cookies name and marks.
As a franchisor, the Company's principal business is to sell franchises and continuing fees to provide managed assistance of those franchises. Franchise rights may be granted through a franchise agreement that sets out the terms of the arrangement with the franchisee. The franchise agreements require that the franchisee remit continuing royalty and marketing fees to the Company based on the monthly revenues of the franchisees. The franchise agreements also require certain, upfront franchise fees such as initial fees paid upon opening of a franchise. The Company recognizes revenue when performance obligations under the terms of contracts with its customers are satisfied, which occurs when pre-opening services are provided to a customer to enable them to direct the use and obtain the benefit of the franchise, with the remaining portion being recognized over the life of the contract.
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 47)
What This Means (2025 FDD)
According to Crave Cookies' 2025 Franchise Disclosure Document, the franchise agreement grants franchisees the right to operate a physical storefront location using the Crave Cookies name and marks. It outlines the terms of the arrangement between Crave Cookies and the franchisee.
The franchise agreement mandates that franchisees remit continuing royalty and marketing fees to Crave Cookies, based on the monthly revenues of the franchisees. Additionally, the agreement stipulates certain upfront franchise fees, such as initial fees paid upon the opening of a franchise.
Crave Cookies recognizes revenue when performance obligations under the terms of contracts with its customers are satisfied. This occurs when pre-opening services are provided to a customer to enable them to direct the use and obtain the benefit of the franchise, with the remaining portion being recognized over the life of the contract. This means that Crave Cookies earns revenue not only from initial fees but also over the duration of the franchise agreement as the franchisee operates their business.